When the bills begin piling up in the mail, it can feel overwhelming, maybe even paralyzing. After missing one or two mortgage payments, it becomes incredibly challenging to catch up on your balance, so what do you do?
Do you sell the house? Ignore the problem? Let it go to foreclosure?
If you’re asking, “How can I sell my house fast before foreclosure?” you’ve come to the right place. At Joe Homebuyer, we make it easy and fast to sell your house in Arizona, no matter what condition it’s in. Below, you’ll find all the details you need to know about avoiding foreclosure through a home sale.
If you need a fast cash offer, call us at (602) 461-8088.
Understanding Foreclosure
Foreclosure is a scary word, but not all homeowners actually understand what it means. Foreclosure happens when a homeowner misses enough mortgage payments that the lender takes legal action to repossess the property. This may lead to various consequences, such as damage to your credit score or the repossession of your home.
Can I Sell My House Fast To Prevent Foreclosure?
“So, can I sell my house fast before foreclosure?” Yes, if you’ve been getting some overdue bills in the mail and suspect that foreclosure may be on the horizon, you can act first. You may either pay your overdue balance to correct the situation, or you can sell your house, with the proceeds paying off your obligation.
Selling your house before your lender takes legal action allows you to avoid many of the financial and credit repercussions that arise with foreclosure.
How Much Time Do You Have To Sell Before Foreclosure?
Foreclosure timing depends on your state and specific mortgage company policies. In Arizona, lenders typically must wait until the borrower misses payments for at least 120 days to begin the foreclosure process.
If you cannot make your payments for three months, you’ll likely receive some type of notice or demand in the mail, detailing your obligations, how much you owe, and the timeline moving forward. From here, you’re usually given another 30-day notice to fulfill your balance. From the date of this demand letter, it may be as little as only two or three months before your home is foreclosed on and sold if you do not make this payment or sell it yourself.
In some locations, foreclosure can take much longer, but it’s still important to act fast so you can protect your finances.
The Advantages of Selling Pre-Foreclosure
If you’re asking, “Why should I sell my house fast before foreclosure?” we get it. It’s tempting to just let your lender take over and handle the sale on your behalf. Selling a house seems like a daunting process, but in this case, it offers quite a few advantages:
- Credit protection: In terms of credit impact, foreclosure is similar to bankruptcy. It will severely impact your credit for quite a few years, affecting your ability to buy or rent another home, lease a car, and more. Selling your house pre-foreclosure allows you to protect your credit by paying off the outstanding balance before the bank takes action.
- Control over the sales process: When a house goes to foreclosure, it becomes a court-ordered sale, where the bank has control over the timeline, negotiations, the buyer, the sale’s price, and everything else. With a pre-foreclosure sale, you can move at your own pace (somewhat), choose who buys your home, and set a price that you’re OK with.
- Potential for mortgage forgiveness: In some cases, you might only be able to get an offer for less than what you owe on your mortgage. In this case, your lender may still be willing to forgive the deficiency rather than take legal action.
- Fee avoidance: The foreclosure process often involves legal fees and costs that can only add to an already challenging financial situation.
- Home value preservation: Foreclosure properties often sell for below market value. Even if you’re trying to sell your house fast, you still may be able to get a reasonable offer.
- More time for home prep: With control over your timeline, you can make minor repairs if you want, stage the house, and clean it so it’s in the best shape possible for selling. You also have more time to pack and get ready for your move.
Your Options To Stop Foreclosure by Selling
“So, what are my options if I want to sell my house fast before foreclosure?” You have a few choices here, ranging from standard sales to cash offers, depending on how fast you actually need to sell:
- Standard sale: You can hire a real estate agent and list your home on the market in the traditional manner. This option takes the longest but may yield higher offers.
- For sale by owner (FSBO): You may also choose to skip working with a real estate agent and try selling your house directly. Doing so allows you to avoid certain fees, but the process takes more time as you lose the valuable experience and connections of an industry expert.
- Short sale: If your balance amounts to more than your home’s value, you may be able to pursue a short sale, where the lender agrees to accept a lower amount than what you owe on the loan when you sell.
- Cash buyer: Cash sales are typically the fastest and simplest options. You can sell to any home-buying or real estate investor who will offer fast cash for a fair value of your home, eliminating the need for major repairs, real estate agents, etc.
The Steps to Selling Your House Before Foreclosure
How to sell a house before foreclosure ultimately depends on the method you choose from above. In general, here’s what the process will look like:
1. Determine Your Home’s Value
First, you need to get an estimate for your home’s value so you know what you’re working with. You can get a professional valuation or use an online tool as a starting point. Once you know your home’s value, you’ll have a better idea of your financial position.
For example, if your home has appreciated significantly over the years, you likely won’t need to consider a short sale, as a cash offer or standard sale may cover your balance. If it’s depreciated, though, or if the value is less than you expected, you may need to consider negotiating with your lender.
2. Calculate What You Owe
Now, you need to figure out exactly how much you owe. This includes all of your missed payments, any accrued fees, late fees, interest, or anything else your lender may have charged over the months. You can contact your bank and request a write-up of your full balance.
Once you’ve calculated your balance, subtract this from your estimated sales price to get an idea of whether your home sale will cover your fulfillment.
3. Consider the Selling Fees
Depending on how you choose to sell your house, you may face significant costs. Hiring a real estate agent comes with fees, as do staging, marketing, repairs, closing, and so forth. By now, you need to think about how much these steps will affect your financial position.
We recommend calculating how much it will cost to go the traditional sale route to determine whether it will be worth it. If you’ll have enough time and money left to sell your house the standard way and work with a real estate agent, you can consider this route. If not, you may want to look into a cash offer.
4. Price and Market Your Property
If you choose to go the standard route, the next phase will involve pricing your house and listing it on the market. Your real estate agent will guide you through making minor repairs, cleaning the property, staging it, scheduling open houses, negotiating with buyers, and more.
It’s important that you keep in contact with your lender throughout this process. Don’t decline their calls. Keep them updated on how the sale’s process is going and let them know about any offers you receive, as this may extend your timeline.
5. Get Quotes for Cash Offers
If the standard real estate market isn’t feasible for your timeline, it’s time to consider a cash offer. With this route, an investor will make you a fair offer in cash, and you can get paid in just a few days.
You skip the hassle and fees of listing traditionally, and you get to close as quickly as possible. They won’t require you to make repairs on the home, as they typically buy properties in as-is condition.
Once you accept an offer, the sale proceeds will go toward paying off your mortgage balance. Anything that’s left is yours to keep.
Are You Selling a Home Quickly To Avoid Foreclosure? Get an Offer From Joe Homebuyer
“Can I sell my house fast before foreclosure?” Yes! Get a fast, all-cash offer from Joe Homebuyer by calling (602) 461-8088 today to schedule a consultation.
